| Joel Carson |
Whether you’re shopping for your first Utah home loan or are an experienced investor, your loan profile is more important than ever before. A well-organized loan file initiated by you is a valuable asset – particularly since the recent mortgage crisis.
FannieMae and FreddieMac are coming down hard on mortgage underwriters who approve “bad loans.” The days of loan officers giving a friendly wink and a nod to get a loan approved are gone. Originating lenders of bad debt are now being forced to buy back their own ill-gotten notes. This could get costly and has been deadly for small lending institutions that drowned in their own seas of uncollectable debt.
Just get used to the idea: You will be required to lay your entire financial life out on the table in order to secure a mortgage loan. The more prepared you are when you start the approval process in anticipation of buying your Utah dream home the happier you’re going to be.
Raise your right hand and say it with me: “I do solemnly swear to create a stellar loan file that will knock my lenders’ socks off.”
Ready? Let’s get started.
Store Files Securely
Do yourself a favor and scan your important financial documents onto your hard drive. It’s a good idea to password-protect these electronic records. Burn them to a CD and store an extra CD in a safe deposit box. Be sure to update your records regularly. Maintain original files in a safe place at home or in the office. Some Utah home lenders require originals copies of certain documents.
If you do business online, print or download PDF files of all important transactions. Save these on a hard drive and/or on a CD in well-organized folders. This can be a real time saver later.
Start Your Collection Now
Your loan file should include:
- checking/savings statements
- investment documentation
- retirement account information
- documents relating to every asset you claim to own
- substantiation of gifts from relatives
- documents related to non-profit grants
- creditor statements
- income/expense records for all rental and investment properties
- documentation of any loans for which you have co-signed
- proof of any assets for which you share ownership
- two-years of filed tax returns
- employment verification and check stubs or deposit statements
- copies of vital records such as birth certificates and death certificates
- relevant marriage or divorce documents
Self-employed borrowers should be prepared to provide the above documentation and the following:
- an audited or professionally-prepared balance sheet for the previous two years’
- year-to-date profit and loss statement (sole proprietors)
- signed copies of the previous two years’ federal business income tax returns with all schedules (corporations and partnerships)
- a professionally-prepared profit and lost statement
Certain circumstances might require additional documents. Be prepared to cooperate fully with your underwriter for peace of mind and a smooth loan process.
Call me at 801-673-3333 if you have questions about this subject. I’ll make sure you’re directed to the right professional to help you. Please browse our online Utah home listings available 24/7.
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